Work on a botched program to develop software for the Defense Medical Examination Review Board was performed by an Alaska native company, said Steven Davis, a spokesman for the Space and Naval Warfare Systems Command. The command’s Atlantic center contracted with software engineering firm Barling Bay LLC to support development of a medical records system that has come under fire for failing so severely that responsibility for the work was transferred to the General Services Administration.

Barling Bay is a subsidiary of Three Saints LLC, a holding company headquartered in Anchorage. Under federal law, Alaska native firms receive preferential treatment in government contracts.

Sen. Claire McCaskill, D-Mo., chairwoman of the contracting oversight panel for the Homeland Security and Governmental Affairs Committee, charged in a Dec. 7 letter to Chief of Naval Operations Adm. Jonathan Greenert that SPAWAR’s management of the contract for service academy exams was “so inadequate that the General Services Administration had to assume responsibility.” The review board determines the medical qualification of more than 50,000 applicants annually for appointment to a U.S. service academy, the Uniformed Services University of the Health Sciences and the Reserve Officer Training Corps.

McCaskill also told Greenert that software development is “now behind schedule and more than $7 million over budget because SPAWAR underestimated the project’s cost.” A Defense source told Nextgov, “the anticipated delivery date is unknown, but it certainly won’t be delivered until late 2013, if at all.”

Davis did not define the scope of Barling Bay’s responsibilities on the contract.

The 1971 Alaska Native Claims Settlement Act gives Alaska native corporations special contracting advantages aimed at benefitting disadvantaged and economically depressed communities, but critics say the program has lined the pockets of non-natives and done little to aid those it was designed to help, Government Executive Magazine has reported in articles dating to 2005.

Barling Bay, which has corporate offices in Charleston, S.C., seven miles from SPAWAR, was the fastest growing company in the state in 2011, according to a press release on the Three Saints website.

Established in 2002, Barling Bay had revenues of slightly less than $30 million in 2010, according to a company presentation that described work on health care systems projects for the Military Health System, the Veterans Affairs Department and the Navy Bureau of Medicine.

VA told Nextgov last week that it has an agreement with SPAWAR for the command to work on a number of information technology projects, including development of the integrated electronic health record with the Defense Department.

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